The answer to the question “What is fair?” usually depends heavily on one's perspective.

Be it the division of income between an artist and his label, the participation of songwriters in the big streaming cake or how much services like Spotify should actually keep to themselves: there is no one answer.

Benjamin Fisher

Editor in Business.

  • Follow I follow

Markku Mäkeläinen prefers to stay out of things like this: "For us, what two parties in the music industry have agreed is fair." The Finn recently worked for Facebook, among other things.

Since January 2021 he has been running Utopia Music, headquartered in the canton of Zug.

“We are a neutral actor – just like Switzerland,” he says with a laugh.

As such, Utopia should be involved in the complicated hustle and bustle of music marketing as far as possible.

The company's motto is "Fair Pay for Every Play".

According to Mäkeläinen, fairness results from raising the funds to which partners from industry are entitled through the use of their works on whatever channels: “We map what was played when and where and bring this information with the rights relationships and the respective owners together".

The recording is the basic requirement for payments to be able to flow to the respective rights holders.

The information about these – it is not uncommon for more than 10 parties to hold rights to a song – must of course be carefully stored for this purpose.

"Utopia will never own rights itself"

Rights management is a complex field, and inaccuracies can be expensive - or ensure that the rights holder concerned does not receive any money.

In the USA, for example, various streaming services paid out around 424 million dollars to a newly established collecting society in mid-February last year.

The proud sum consisted of non-assignable royalties for authors.

The so-called tracking of music on radio, television or on various digital platforms is also an important task.

In addition, there are different legal regulations and local collecting societies in different markets, says Roberto Neri, who is responsible for the operative business of the Swiss company.

Due to this decentralized structure, money sometimes only reaches the rights holders very late.

Utopia wants to help close data gaps in order to ensure more income for the industry, which should also be paid more quickly: "We want to be the backend of the music industry," summarizes Neri.

Large service portfolio through takeovers

Utopia is not a disruptor, emphasizes Mäkeläinen.

"Our goal is to ensure more efficiency and accuracy, not to change the way the industry works." In this way, the industry partners could also make better use of the new marketing opportunities in gaming or the metaverse.

According to its own statements, the “music fintech” is currently working with 1,100 publishers and 1,800 labels.

Founded in 2016, it represents six million rights, and its customers also include the big three in the industry, Universal, Sony and Warner Music, according to Utopia.